The Board of Investments (BOI) is now scrambling to fulfill its incentive agreement with automotive manufacturers after the ₱4.32-billion budget for the Comprehensive Automotive Resurgence Strategy (CARS) program was cut from the 2026 national budget.

The CARS program was one of the seven unprogrammed appropriations (UAs) that President Ferdinand “Bongbong” Marcos Jr. vetoed when he signed on Monday, Jan. 5, the ₱6.79-trillion budget for the year.

“We fully respect the decision of the President. We understand the context of his overall decision on unprogrammed appropriations,” said Trade Undersecretary and BOI managing head Ceferino Rodolfo in a message to reporters.

Rodolfo said the ₱4.32 billion was intended to cover the government's remaining obligations to participants in the CARS program.

Under the program, the government would provide fiscal support to participating companies that produced at least 200,000 units of their enrolled model within six years.

These incentives are in the form of tax payment certificates (TPCs), which participants may use to settle their tax and duty obligations.

In an effort to uphold investor confidence, Rodolfo said they are already working with other agencies, such as the Department of Budget and Management (DBM), to ensure payment of these obligations.

He said holding up the government’s end of the bargain is critical since these incentives “had been based on validated delivery of performance commitments and on a robust and transparent inter-agency process of vetting claims against the CARS program.”

Launched in 2015, the CARS program’s main thrust was to grant “time-bound and output or performance-based fiscal support” to attract strategic investments in the manufacturing of vehicles and their components.

Only two of the three slots opened in the program were filled, namely by Toyota Motor Philippines Corp. (TMPC) for the Vios and Mitsubishi Motors Philippines Corp. (MMPC) for the Mirage.

In a bid to strengthen the automotive industry, the Department of Trade and Industry (DTI) planned to launch Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE), another incentive program.

The RACE program focuses on three models of four-wheeled internal combustion engine vehicle models, with a lower production requirement.

But this, too, was among the UAs scrapped by President Marcos. The DTI sought ₱250 million for the program.

In total, Marcos vetoed ₱92.5-billion worth of projects under the UAs, which form part of his efforts to “ensure that public funds are expended in clear service of national interests.”